The UK government’s decision to extend the ban on evictions for commercial tenants has been met with mixed reactions. While struggling retailers have found relief in the extension, landlords are concerned about the impact it may have on their investments. Originally set to end on 31 March, the ban has now been extended to 30 June to give businesses more time to recover from the effects of the pandemic.

Business Secretary Kwasi Kwarteng recognizes the importance of this support for businesses, acknowledging that it will give them the necessary breathing space to prepare for a safe reopening and to rebuild stronger in the future. This extension comes at a time when an estimated £4.5 billion in commercial rent debts have accumulated since the moratorium was implemented, with many retailers taking advantage of the policy to withhold rent.

Helen Dickinson, CEO of the British Retail Consortium, emphasizes the significance of the ban on aggressive rent enforcement for retailers. She explains that these measures have been crucial in protecting businesses from being forced into administration by landlords, especially considering the £22 billion in sales lost during the three lockdowns.

However, not all property owners share this perspective. The British Property Federation, representing major property companies, expresses their dissatisfaction with the continuation of the ban. They argue that well-capitalized businesses who can afford to pay rent but choose not to have negatively impacted commercial property investments and strained local authority landlords and public finances.

Mark Allan, CEO of Land Securities, co-owner of Bluewater shopping centre, shares concerns about the long-term effects of the moratorium on the relationship between landlords and tenants. He emphasizes the need for collaboration between the two parties during these challenging times, rather than creating divisions.

In response to these concerns, the government states that it aims to support commercial landlords and tenants in reaching their own agreements for paying or writing off rent debts by 30 June. It has also launched a call for evidence on commercial rents to monitor the progress of negotiations between landlords and tenants. This process will provide insights into possible steps the government can take after 30 June, such as a phased withdrawal of current protections or legislative options targeted at the businesses most affected by the pandemic.

As the UK continues to navigate the challenges brought about by the COVID-19 crisis, finding a balance between supporting struggling retailers and addressing the concerns of landlords will be crucial for the long-term sustainability of the retail sector. While the extension of the eviction ban provides temporary relief for retailers, a comprehensive and collaborative approach will be needed to find a sustainable solution for all parties involved.

Useful links:
1. Government Guidance for Shops and Branches during COVID-19
2. British Retail Consortium website